Bear Publishing sells a nature guide

ECONOMICS

Multiple Choice

Bear Publishing sells a nature guide. The following information was reported for a typical month (sales volume is constant each month):


Total


Per Unit


Sales


$17,600


$16.00


Variable expenses


$9,680


$8.80


Contribution margin


$7,920


$7.20


Fixed expenses


$3,600


Net operating income


$4,320


Bear is expecting a 20-cent increase in variable expenses. No other changes are expected or planned. How much contribution margin should Bear expect after the increase?

A. Can't be determined
B. $4,100
C. $7,700
D. $9,900

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